READ: Donald Tusk's full statement on what the EU wants in upcoming Brexit talks

READ: Donald Tusk's full statement on what the EU wants in upcoming Brexit talks

SPEAKING in Luxembourg, European Council President Donald Tusk set out the European Union's guidelines for the next phase of Brexit talks.

GOOD afternoon. I am very happy to be back in Luxembourg. And very happy to be here with my colleague and good friend, Prime Minister [Xavier] Bettel, to discuss the agenda of the March European Council.

Two hours ago, I sent the EU27 Member States my draft guidelines for our relations with the UK after Brexit. I'm here in Luxembourg to consult the Prime Minister on these guidelines that I hope will be adopted at our European Council in March. It is not a coincidence that once again I start my consultations ahead of a European Council meeting here in Luxembourg with Prime Minister Bettel. I really value your advice – always very constructive and responsible.

My proposal shows that we doesn’t want to build a wall between the EU and Britain. On the contrary, the UK will be our closest neighbour and we want to remain friends and partners also after Brexit. Partners that are as close as possible, just like we have said from the very first day after the referendum.

And, in this spirit, I propose close co-operation within the following areas.

Firstly, as we are confronted with similar security threats, I propose that the EU and the UK continue our common fight against terrorism and international crime. The increasing global instability requires our uninterrupted co-operation in defence and foreign affairs. It is about the security of our citizens, which must be preserved beyond Brexit.

Secondly, we invite the UK to participate in EU programmes in the fields of research and innovation, as well as in education and culture. This is key to maintain mutually beneficial and enriching personal networks in these vital areas, and for our community of values to prosper also in future.

Thirdly, I am determined to avoid that particularly absurd consequence of Brexit that is the disruption of flights between the UK and the EU. To do so, we must start discussions on this issue as soon as possible.

Now, coming to the core of our future economic relationship. During my talks in London last Thursday, and in her speech last Friday, Prime Minister Theresa May confirmed that the UK will leave the Single Market, leave the customs union and leave the jurisdiction of the ECJ (European Court of Justice). Therefore, it should come as no surprise that the only remaining possible model is a free trade agreement. I hope that it will be ambitious and advanced – and we will do our best, as we did with other partners, such as Canada recently – but anyway it will only be a trade agreement.

I propose that we aim for a trade agreement covering all sectors and with zero tariffs on goods. Like other free trade agreements, it should address services. And in fisheries, reciprocal access to fishing waters and resources should be maintained.

This positive approach doesn't change the simple fact that because of Brexit we will be drifting apart. In fact, this will be the first FTA in history that loosens economic ties, instead of strengthening them. Our agreement will not make trade between the UK and the EU frictionless or smoother. It will make it more complicated and costly than today, for all of us. This is the essence of Brexit.

To sum up, we will enter the negotiations of the future relations with the UK with an open, positive and constructive mind, but also with realism. From my point of view, the outcome of the negotiations must pass two key tests:

The test of balance of rights and obligations. For example, the EU cannot agree to grant the UK the rights of Norway with the obligations of Canada;

The test of integrity of the Single Market. No Member State is free to pick only those sectors of the Single Market it likes, nor to accept the role of the ECJ only when it suits their interest. By the same token, a pick-and-mix approach for a non-member state is out of the question. We are not going to sacrifice these principles. It's simply not in our interest.

Finally, a few words about another topic of the March summit. Following the announcement of President Trump, there is a risk of a serious trade dispute between the United States and the rest of the world, including the EU. President Trump has recently said, and I quote: 'trade wars are good, and easy to win'. But the truth is quite the opposite: trade wars are bad, and easy to lose. For this reason, I strongly believe that now is the time for politicians on both sides of the Atlantic to act responsibly.

Given that President Trump's announcement may have repercussions for our citizens and European businesses, not to mention the global economy, I will propose that the EU leaders have an extraordinary trade debate at the upcoming summit. We should have a clear objective in mind: to keep world trade alive. And, if necessary, to protect Europeans against trade turbulence, including by proportionate responses in accordance with the WTO. Thank you.

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